SBI gets its first lady chief

Tuesday, October 08, 2013

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The youngest of the managing directors of SBI will become the first woman chief of the country's largest lender, Arundhati Bhattacharya, who has served in various positions, including head of SBI Capital Markets Ltd,

Arundhati Bhattacharya, 57, the youngest of the managing directors at State Bank of India (SBI), will become the first woman chief of the country’s largest lender, succeeding Pratip Chaudhuri, who retired on 30 September.

The government on Monday announced the appointment of Bhattacharya as the next chairperson of SBI for three years. Bhattacharya is also SBI’s chief financial officer. And, at least until finance minister P. Chidambaram cleared her appointment as chairperson on 25 September, her name was among the least mentioned as the next chief of the country’s biggest lender.

This is the first time that an SBI chief will get a three-year tenure, irrespective of when the person will retire. Technically, Bhattacharya was the only eligible candidate for the post, going by her residual service (none of the other three had the required years of service left), but the scope widened and chances were equal to all four managing directors after the government relaxed rules, allowing the other three to appear for the interview.

Bhattacharya’s name was finalized for the SBI top job after the appointments committee of the cabinet, headed by Prime Minister Manmohan Singh, gave its clearance.
Bhattacharya’s appointment adds to the growing list of women who head commercial banks in India and together oversee close to 40% of the industry’s assets.

Bhattacharya joined the bank in 1977 as a probationary officer and has served in various positions, including head of SBI Capital Markets Ltd, the bank’s investment banking unit.
Prior to this, Bhattacharya had served as a deputy managing director and corporate development officer at SBI.

She has undertaken various assignments spanning credit, foreign exchange, treasury and retail operations. Besides, Bhattacharya had a brief stint at the Bank’s office in New York.
On 21 September, an interview panel comprising financial services secretary Rajiv Takru and Reserve Bank of India deputy governor Anand Sinha had shortlisted Bhattacharya and Hemant G. Contractor, another managing director of SBI, for the post of the bank’s chairperson.

Besides Bhattacharya and Contractor, A. Krishnakumar and S. Viswanathan, the other two managing directors of SBI, were also interviewed.
Contractor is in charge of international operations. Krishnakumar and Viswanathan look after national banking and associates and subsidiaries, respectively.

SBI insiders say Bhattacharya has experience across almost all major business segments ranging from retail and corporate finance, treasury and international operations. “She has a balanced approach on handling issues, which is required for the top job,” said a SBI official who asked not to be identified.

In SBI circles, Bhattacharya is also known as a bit of a task master and takes tough calls.
Bhattacharya was instrumental in creating three of the bank’s newest subsidiaries -- in general insurance, custodial services and the SBI Macquarie Infrastructure Fund.

Unlike her predecessor, Pratip Chaudhuri, who clamped down on union activities, Bhattacharya shares a good rapport with the trade unions.
State Bank officials who work closely with Bhattacharya cite her successful negotiations with the officer’s federation when unions planned a major strike against the management’s plan to move to a seven days’ working arrangement in 2012 (this meant keeping banking operations on all seven days of the week, not making everyone work seven days a week).

Bhattacharya was then deputy managing director and corporate development officer in charge of human resources.
Still, some SBI officials say Bhattacharya lacks the experience of working at the corporate office as she has “spent most of her career outside headquarters”.

Indeed, the top post of SBI will be a challenge for Bhattacharya given that the bank’s bad assets have been growing and its profits are under strain. The bank’s gross non-performing assets in the June quarter was 5.56%, and net profit for the three months dropped 13.6% to Rs 3241.08 crore from Rs3751.56 crore in the year-earlier period.